Innovation Minister Christopher Pyne appears to be floating plans for a tobacco tax hike.

Speculation has been mounting that the Turnbull Government could take on an idea recently raised by the Opposition, despite former PM Tony Abbott labelling it a “workers’ tax”.

There is no detail on the size of any potential LNP smoke tax rise, but Labor’s has pledged to push up the price of cigarettes to $40 over the next four years.

Mr Pyne said cutting smoking rates would lower health costs. 

“We have very high tobacco taxes, but we also have found, as a Minister for Health in the Howard Government...one of the most significant ways of reducing health costs is to reduce the number of smokers,” he told Channel Nine.

“It makes a direct impact on the cost to health on the rest of the community.”

Mr Pyne hinted that any excise hike would be smaller than the “massive” increase proposed by Labor.

Labor says its plan would bring in $105 billion over ten years.

Finance Minister Mathias Cormann has not ruled out higher taxes on cigarettes.

“I’m not going to go into specific measures in the Budget,” he told Sky News.

“The Budget will be delivered on the third of May but what I can say is that our focus has been on strengthening growth, creating more jobs, and as such our focus has been on improving the way we raise the necessary revenue for government, not on increasing the overall tax burden in the economy.”

“Because what we are seeking to do is by improving our tax mix, by making our tax system more growth friendly.”

Ratings agency Moody’s warned that Australia’s increasing national debt could jeopardise the nation’s AAA credit rating.